GST UPDATE

???? Desk of CA. Sharma Praveen Series-581????

DELHI HIGH COURT IN THE CASE OF Saluja Overseas Pvt. Ltd Section 29 of the CGST Act, 2017

?The petitioner challenged the cancellation of its GST registration, effective retrospectively from 01.07.2017, through an order dated 08.10.2021. The cancellation was based on a vague show cause notice (SCN) issued on 26.08.2021, which lacked specific details regarding the alleged non-payment of collected taxes. 

?The court found the SCN to be vague and in violation of natural justice, as no hearing date was provided, and the retrospective cancellation was not mentioned. As a result, the court set aside both the SCN and the cancellation order.

?Additionally, the petitioner sought re-adjudication of its tax liabilities for the financial years 2017-18 and 2018-19. The petitioner contested two orders dated 26.12.2023 and 30.04.2024, which denied Input Tax Credit (ITC) based on the retrospective cancellation of the GST registration of a supplier, Saluja Electronics. Since the cancellation of Saluja Electronics' registration was also set aside, the petitioner argued for the consequential benefit.

?The respondent argued that the petitioner wrongfully claimed ITC because the suppliers did not deposit the taxes. The court, however, noted that the petitioner had an alternative remedy through appeals. It directed that if the petitioner files appeals against the orders within two weeks, the appellate authority should consider them on merits, regardless of delay. The petition was disposed of accordingly.

Sharma Praveen

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